L.A. Chamber Talks With a New Voice

The ideological battle lines in California’s just-ended budget fight were recently broken by a surprising foray out of right field. The largest local chamber of commerce in the state asked the Legislature to pass a temporary sales tax increase to help finance away the state’s monster revenue shortfall.

Even though the Los Angeles Area Chamber of Commerce also proposed more conventional budgetary remedies such as a “major spending reduction,” to Republican ideologues, its support for a tax increase, though not part of the final budget agreement, was sheer heresy. “In our view, the Los Angeles chamber represents solely a handful of elite corporations and does not reflect the interests of either the taxpayers or small businesses,” Jon Coupal of the Howard Jarvis Taxpayers Assn. said.

By elite businesses, did Coupal mean Arco? Pacific Bell or McDonnell Douglas Corp.? Did he mean the Carter Hawley Hale retail chain? This “elite” has actually merged itself away to cities like Charlotte, N.C., Chicago and London. Notoriously, some would even say tragically, L.A. has in 20 years gone from being a Fortune 500 stronghold to a commercial colony. And as corporate might ebbed away, so did the L.A. Chamber of Commerce. Founded in 1888, it was the body that persuaded the city to tax itself 12% of its assessed value to build the Owens Valley Aqueduct and later to help create the city’s park system, the Coliseum and its first museums. But that chamber was an anti-labor, downtown-based, white-male institution in a solid Republican city. In recent years, while it inched toward diversity, the L.A. chamber’s influence fell behind that of institutions like the Central City Assn. -- even, if you go back a couple of decades, to the notorious Committee of 25, the legendary cabal of L.A.’s princes of commerce that held a mythic sway over city politics before corporations mergered away.

So, how did the 1,400-member L.A. chamber suddenly become such a big noise? Whom does it really represent? The county’s small-to-medium business community, whose size, diversity and scope might make up for what the old “handful” possessed in sheer blue-chip dynamism.

“We’re trying to put together a business and civic [forum] that’s countywide, not just downtown,” said George Kieffer, the chamber’s new board chairman. “The big thing is expanding the board so that not only is it influential but representative of small business from all parts of Los Angeles. And that it’s just as ethnically extensive: We’ve got [permanent board] members from the African American Chamber, the Latin Business Assn. and the Asian Business Assn. And we’ve pulled in other business organizations: the Central City Assn.; the Valley Industry and Commerce Assn.; L.A. Economic Development Corp., the Convention and Visitors Bureau.”

“I haven’t heard of another chamber in the country that puts members of other chambers on its board,” said Russell “Rusty” Hammer, the chamber’s president. “Business doesn’t care which side of the street it’s on.”

Not everyone is convinced. One official of an East Asian association said, “The new chamber has a bunch of ethnic ex officio board members. But the [100-plus member] main board is still overwhelmingly from traditional areas.”

The new chamber flexed its political muscle in the last election, when it successfully pushed for the statewide water bond initiative and county trauma center tax. Now its willingness to stand against the Republican anti-tax dogma has won the chamber praise from diverse quarters.

“Whether they support [the sales tax proposal] or not, they’ve earned the right to do it,” said conservative L.A. County Supervisor Don Knabe.

Bart Diener, assistant general manager of Service Employees International Union Local 660, the major county employee union, said he appreciated the chamber’s willingness to defy dogma in the budget scrimmage. Later this year, the chamber will discuss whether to support such reforms as ending the two-thirds majority requirement for passing a state budget.

“We think [the chamber] provides a way to work with business to promote decent development and renewal,” said Roxana Tynan of the Los Angeles Alliance for a New Economy. County Federation of Labor leader Miguel Contreras said, “We hope businesses will follow the chamber’s lead and also hope it’s not too little, too late.”

This year, the chamber supported winning City Council candidates Greig Smith, a West Valley conservative, and Martin Ludlow, a South L.A. progressive. “We like to feel we’re like the Good Housekeeping seal of approval for measures and candidates,” Kieffer said.

The Kieffer-Hammer partnership usually works behind the scenes. With the water bond measure, for instance, “the state Chamber of Commerce in Sacramento was going to oppose this,” Kieffer said. But the L.A. chamber’s reps in the state chamber blocked the opposition. The result was that “the state chamber stayed neutral and most of the other chambers throughout the state endorsed it,” he said. Kieffer is convinced that without this strategy, the measure would have lost.

Because Democrats hold sway on Los Angeles County voter registration rolls and because the county’s small- and midsize-business owners tend to be Democrats, the L.A. chamber will be more progressive, more willing to work with labor, than chambers in other cities and L.A.’s past ones. Kieffer and Hammer admire the old L.A. chamber’s accomplishments but are changing the organization’s assumptions. Kieffer stressed that “we don’t want to be the new Committee of 25.”

The chamber’s recently formed Los Angeles Chambers Advocacy Network promises to unite 100 business organizations and 50,000 businesses countywide. Members will receive information on how the chamber wants the Board of Supervisors and city councils, or even state and national legislators, to vote on matters of concern. Sometimes these would be consensus items, like proposals to settle budgets or revive downtown Los Angeles. Usual business interests would be put first. The chamber, for example, does not support the “living wage,” which sets a minimum hourly wage.

But can such diversity be expressed with a united voice? Kieffer sees the new chamber primarily as a voice for business and as a necessary component in the representation of all community interests, particularly long-term interests, in an era of term-limited officeholders with short attention spans. This voice has been absent from civic debate for some time, but not any longer.